Money world

Treasury Secretary Timothy Geithner said on Wednesday that fallout from the European debt crisis along with fears of Iran and higher oil prices posed the biggest threats to the U.S. economy.

“Europe is still facing a very difficult, very challenging period. They are likely to have weak growth,” Geithner said in an interview with Fox Business TV.

“You have, obviously, the fear of Iran and oil prices, even though that is not hurting the economy today, people can still feel that in their pocketbook today,” he said.

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LONDON/BEIJING

Federal trade officials today announced a decision to impose modest tariffs on solar panels from China after concluding that the government there unfairly subsidized manufacturers.

But the duties, ranging from 2.9 percent to 4.73 percent, are less than some analysts and industry officials had anticipated, raising questions as to how much U.S. manufacturers will benefit.

Tuesday’s decision stems from a complaint by the Oregon-based subsidiary of Germany’s SolarWorld AG and six other manufacturers accusing Chinese rivals of dumping crystalline silicon solar cells and panels in the United States at artificially low prices and receiving billions of dollars in Chinese government subsidies.

The resulting investigation is among several pending trade cases that have escalated tensions between the economic superpowers in recent months. It has also fractured the U.S. solar industry during a period of record growth.

SolarWorld sought tariffs to offset the flood of low-cost Chinese solar panels that now make up about half of the U.S. market, up from 8 percent in 2008.

Sales of Chinese-made solar panels in the U.S. has quadrupled over the past two years to $3.1 billion in 2011, according to the Commerce Department.

Meanwhile, prices in the United States fell by 50 percent, leading at least a dozen American manufacturers to close plants, lay off workers or go bankrupt, SolarWorld said.

But solar developers and installers have benefited the rapid decline that contributed to a record 1,855 megawatts of solar-power generating capacity going on line last year, according to GTM Research.

Solar developers including California-based SunEdison — a unit of O’Fallon, Mo.-based MEMC Electronic Materials Inc. — say tariffs on Chinese imports would raise prices for consumers and be a net job killer.

The majority of the U.S. solar industry’s 100,000 jobs are installers, distributors and electricians who work for small firms “downstream” of the manufacturing process, and those jobs would be in jeopardy if solar prices rise, they say.

Jigar Shah, president of the coalition, whose members include MEMC, called Tuesday’s decision is “relatively positive” and said it wouldn’t “significantly raise solar prices in the United States.”

“This decision clearly demonstrates that the Commerce Department did not find the Chinese government engaged in massive subsidization,” Shah said.

But SolarWorld and other manufacturers who brought the case said it affirms what they alleged — that Chinese manufacturers benefited from unfair government assistance.

The coalition of solar manufacturers that filed the complaint said the duties announced Tuesday are consistent with the government’s findings in other countervailing duties cases involving China.

Gordon Brinser, president of SolarWorld Industries America Inc., said Tuesday’s decision is “the first step in a process that will roll out over the next several months.”

The companies that filed the complaint didn’t ask for a specific level of countervailing duties. But they did seek anti-dumping duties of 100 percent or more. And that part of the case is yet to be decided.

The Commerce Department is continuing its look into allegations that China sold panels in U.S. at below-market prices. A separate set of anti-dumping tariffs could be imposed based on the results. A preliminary decision is expected on May 17.

“If we address unfair trade practices in the U.S. solar market, we can get back to our business of expanding American manufacturing and jobs in the renewable energy sector,” Carlo Santoro, an executive at New Jersey-based MX Solar USA, said in a statement. “We look forward to getting back to the fair and legal competition that serves everyone best.”

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Signs bearing a skull and crossbones dot the banks of a reservoir and canal near this town on the U.S.-Mexico border, but the fishermen standing in the reeds nearby ignore them, casually reeling in fish that are contaminated with toxic chemicals and banned for human consumption.

Some do it to quell their hunger, others to make some cash by selling the carp, catfish and gar in nearby neighborhoods.

“It’s a great little lake,” says Joe Garcia, 43, among those fishing here one day recently, where a carp with the highest levels of toxic PCB chemicals ever tested in a fish was caught years ago. He says he throws back his catch but a lot of others here can’t afford to pass up the meal.

The reservoir is one of thousands of sites along the U.S.-Mexico border where industry, pesticide use and population growth left hazards in past decades that still await solutions. Donna is among the worst _earning a place on the Environmental Protection Agency’s priority list _ and illustrates how slowly the government cleanup process moves and how those struggling for subsistence in poor areas like this sometimes do not wait.

Four years after the site made the priority list, the EPA plans to begin soon extensive sampling of the water, sediment and fish that could become the foundation for a cleanup plan.

But with limited funds and an elaborate process, the effort could take years, leaving authorities to educate a population that is often more concerned with daily survival than warnings of potential problems. Donna reservoir is surrounded by fields of swaying sugarcane and green leafy rows of celery. Workers who toil in migrant agriculture live in sparse neighborhoods of trailer homes and campers that border the canal. Some stubbornly believe they can cook the chemicals out of the fish, state environmental officials say.

“They just don’t tend to pay attention to that (sign),” said Juan Salazar, 41, who became so frustrated by the fishermen crossing his yard to reach the water that he erected a small fence.

“There are too many low-income families here that may make a living selling this stuff.”

State and federal officials have repeatedly gone door-to-door to warn residents since PCB contamination was discovered in 1993. Twice federal authorities used electric charges to kill more than 35,000 fish in the reservoir and the 6 1/2-mile canal that brings water from the Rio Grande. But the fish _ at least 22 species, including tilapia and largemouth bass _ repopulate.

Every day, people are drawn to the tranquil scene, where birds feed along the shores and fish constantly break the surface. Officials believe many area residents fish there to supplement their diet. But in the fatty tissue of the fish are polychlorinated biphenyls or PCBs, an industrial residue apparently emanating from something dumped in the canal years ago. Officials say it could be a submerged piece of machinery but haven’t been able to find it.

PCBs, typically found as oily liquids in electrical equipment, have been banned in the U.S. since 1979 after causing cancer in animal testing. Researchers believe the chemicals can lead to lower birth weights, suppress the immune system and increase the risk of cancer.

A carp caught in the Donna canal 19 years ago contained more than 1,500 times the limit of PCBs believed safe, the highest such reading ever. Members of the family who ate it had elevated PCB levels in their blood. Readings taken since then in the lake have been lower but still in the hazardous range.

However, the health impact on those eating Donna reservoir fish is unknown because no health survey has been conducted. A 2010 study by Texas Department of State Health Services estimated nearly 4,000 people living within a one-mile radius.

The EPA is planning a community meeting in late March to begin the process that could lead to a cleanup plan. One of the best-known PCB cleanup efforts _ on a much larger scale _ continues in New York’s Hudson River more than 27 years after it made the priority list. Tons of sediment have been dredged from the riverbed.

Though nearly a dozen people were interviewed near the reservoir for this story, only one admitted to eating the fish he caught, but he then declined to speak further _ there is a $500 fine for taking the fish, but not if you throw them back.

Officials said some men in the area tend to shrug off the danger but women have been more receptive. Rafael Casanova, EPA project manager, said a pregnant woman he talked to during a local canvas told him she had bought lake fish from someone selling it in the neighborhood.

When he described the health danger, “She was very impressed by that,” he said. “I felt good about that one.”

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The Federal Reserve Bank of New York bought the building at 33 Maiden Lane for $207.5 million from Merit US Real Estate Fund III, LP, according to a statement on the district bank

As any driver knows, rising gas prices can put a dent in a household budget. For small business owners, it can hurt _ or even wipe out _ profits.

The recent rise in the price of gas is pressuring business owners to find ways to protect their earnings. Some of their strategies are simple, such as using GPS devices to track fuel usage. Others are drastic _ like moving manufacturing operations to the U.S. from Asia.

Small business owners have navigated this road before _ most recently in 2008 when the price of gas rose to a national average of $4.11 a gallon. But gas is expected to surpass that record and reach $4.25 by late April. And even if the price follows its usual pattern of gradually falling back from a high reached in the spring, it will still be expensive for the rest of the year.

Here’s a look at how some companies are coping:

A DIRECT HIT

Chris Hundley runs Limousine Connection, a 31-car limousine service in Los Angeles. He likens the surge in gas prices to “being run into by someone without insurance” _ there’s no way to avoid having to pay.

In 2007 Limousine Connection began adding a 3 percent fuel surcharge to its bills to offset the cost of gas. Since then, the rate has crept up to 10 percent. Hundley says customers have come to understand the necessity for a fuel surcharge, and prefer it to a rate increase.

But the company doesn’t start charging extra on its base hourly rate the minute gas prices rise. For customers that have contracts with Limousine Connection, he’ll wait 30 days, and until prices have gone up 10 percent, before raising the surcharge. If prices rise, say, only 7 percent, he won’t raise it. “We are eating it _ it’s the cost of doing business,” he says.

Hundley also tracks fuel usage. Speeding or idling for extended periods wastes gas, so Hundley monitors driver behavior using the GPS systems installed in his fleet. When the company detects wasteful patterns a manager sits down with the employee to explain how he can help the company keep down fuel expenses. Limousine Connection is so serious about saving gas that, in some cases, it has issued verbal warnings to some drivers.

Hundley also has added more fuel-efficient vehicles to its fleet. The company has some hybrids, and all except a few Mercedes use regular, rather than premium, gas.

CHEAPER TO MAKE IT IN THE U.S.

The rising cost of jet fuel has convinced Seesmart Inc. to make the commercial and household lights that it sells in U.S. factories instead of Asia. Ray Sjolseth, president of the Simi Valley, Calif.-based company, says that the savings he used to get from manufacturing overseas is being wiped out by higher air freight rates.

Sjolseth says his customers tend to have last-minute deadlines. “We don’t have a choice but to air freight the products,” he says He estimates that 80 percent of his goods are shipped by air and that rising rates are raising his manufacturing costs between 5 percent and 8 percent.

So Sjolseth’s solution is to move his manufacturing to the U.S. He currently has one factory in California and expects to have one in Chicago operating by the end of the year. He estimates that a year from now, he’ll save between 5 percent and 10 percent because he won’t be getting shipments by air.

SHIFTING RESOURCES

Higher gas prices are cutting into travel budgets and that’s hurting Towne Park Systems’ revenue. The Annapolis, Md., company runs valet parking services for hotels across the country. These days, fewer guests are parking cars in hotel lots so the hotels don’t need as many attendants.

Town Park responded by shifting some staffers to different jobs, says Kirk Pozadzides, the company’s general manager. The company also provides concierge and other services for hotel guests. Now, the employee who parks cars may shift to working as a concierge.

The company also added “park and fly” services. Towne Park finds unused spaces in garages near airports, and shuttles passengers to airline terminals. It costs a traveler less to use the service than it does to park in an airport lot, Pozadzides says.

“You have to find creative ways to artificially drive revenue,” he says.

WORKING WITH VENDORS

The surge in gas prices in 2008 was a shock for Capriotti’s, a chain of sandwich shops based in Las Vegas. CEO Ashley Morris says the company didn’t pay much attention to a clause in his company’s contracts with distributors that said Capriotti’s would pay more for deliveries if the price of gas went up. So when gas soared that spring and summer, the company was paying far more than it expected for food, paper products and other supplies.

“It hit our business fairly hard,” Morris says.

Now, the surcharge rises and falls based on the price of diesel gas. This time around, he says, Capriotti’s won’t suffer. “We heavily negotiated a sliding scale.”

DELIVERY DILEMMA

Companies that make deliveries are also hurting. Ricky Eisen’s catering business in New York has two trucks and a van. She used to pay $40 to $60 a day for gas for each truck. Now it costs her $72 to $76. And she pays more to vendors for deliveries.

“I’m getting squeezed at both ends,” says Eisen, owner of Between the Bread. “It’s enough to cut a dent in the profit.”

Eisen held out for a long time _ until March 2011 _ before she began tacking on fuel surcharges for her deliveries. She has charged 5 percent extra. Now, she says, “I’m thinking as fuel prices rise, I’m going to have to increase the percentage. Right now, I want to keep it where it is.”

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A storm of criticism in China over share listing plans by a company that sells tonics made with bear bile is highlighting the increasingly affluent country’s changing attitudes toward the environment and wildlife.

Reports Friday said dozens of well-known entertainers, writers and other celebrities signed a petition to the China Securities Regulatory Commission urging it to withhold approval for the initial public offering by Guizhentang, a Chinese medicines maker. The company is awaiting approval for a share listing in Shenzhen.

Hundreds of thousands of comments on “weibo,” the Chinese version of Twitter, blasted the company for extracting bile from bears.

Animal rights groups contend the practice of bear bile farming is cruel because the animals are confined to small cages and milked of bile through catheters inserted into fistulas, or permanent wounds, in their gall bladders.

They say that antibiotics used to counter chronic infections from the practice, and other contaminants in the bile, also pose a hazard to human health.

A photo on the front page of the state-run newspaper China Business News on Friday showed a satirical photo montage of a caged bear, its muzzle bloodied, with a picture of the head of the China Association of Traditional Chinese Medicines, Fang Shuting, quoted as saying that bears are “very comfortable” while the bile is extracted.

News reports cited Fang as saying China has 68 licensed bear farms and more than 10,000 bears farmed for their bile, which can cost up to 4,000 yuan ($635) a kilogram.

A spokesman for Guizhentang, who gave his surname as “Xu,” refused comment.

“It is not the right time for an interview now. We will let you know when we want to do an interview,” Xu said.

Officials at the CSRC said they could not comment on an IPO plan under consideration.

Animal rights are gaining increasing attention in China, with public figures like basketball star Yao Ming and actor Jackie Chan speaking out against eating shark fins and other customs that many view as cruel or a threat to endangered species.

The change reflects both a growing awareness of the need to protect the environment and wildlife and also increasing affluence among many ordinary Chinese who now keep pets, travel overseas and have changing attitudes toward traditions they may not have questioned in the past.

In recent years, for example, animal protection groups have staged mass releases of cats and dogs caged for shipment to restaurants and markets, where they are slaughtered for dishes considered to be delicacies or especially nourishing.

The petition to the stock watchdog from more than 70 celebrities and environmental protection groups seeks to block the IPO and urges the use of synthetic substitutes for bear bile, which is a digestive substance made in the liver and stored in the gall bladder.

The main active ingredient in the bile is ursodeoxycholic acid, or UDCA, which is thought to act as an anti-inflammatory and is used to treat gall stones and liver ailments. It is mainly taken from the Asiatic Black Bear, a protected but not endangered species in China.

Chinese media reports cited Fang as defending Guizhentang’s bile collecting practices in a news conference in Beijing, after visiting its facilities in southeast China’s Fujian province.

“Collecting bile is like turning on a tap. It’s painless, natural and simple. I didn’t see bears suffering in the process,” Caijing magazine quoted Fang as saying.

“After the bile is extracted, bears can still drink milk and honey and have fun in the farm.”

Fang argued that bear farms helped to protect wild bears by discouraging poaching, and that China must preserve its unique, ancient medicinal practices. Animal rights groups contend that poaching continues because buyers view wild bear bile as more potent.

Farmed bears live about four or five years, while those in the wild live up to 30, according to the Animals Asia Foundation, which has been working to close down bear farms and rescue the animals.

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Japan

Federal Reserve Chairman Ben Bernanke on Friday issued a call to action to restore housing markets, saying depressed house prices and sales are a serious drag on the economic recovery.

“The state of housing has been an impediment to a faster recovery,” he told a home builders’ conference.

“We need to continue to develop and implement policies that will help the housing sector get back on its feet,” Bernanke said, laying out a few ideas from a recent Fed “white paper” on housing.

Bernanke’s recommendations for potential policy remedies fly in the face of complaints from some Republicans lawmakers that the Fed was making an unwarranted intrusion onto the turf of other policymakers.

The white paper, issued last month, was the result of several months of study by a Fed staff on a problem officials at the central bank have concluded is a key missing ingredient to a healthier economic recovery.

In his speech, Bernanke touched only on some of the less controversial ideas broached by the Fed in the paper.

He called on lenders and regulators to look at rules and practices that may hold back the origination of sound mortgages, pointing at overly tight credit as one reason the housing recovery has been slow.

An overhang of vacant homes and a glut of foreclosures is also weighing on housing activity, Bernanke added. He said it could make sense in some markets to turn some of the foreclosed homes into rental properties, a policy the Obama administration is already pursuing.

Another top Fed official - Cleveland Federal Reserve Bank President Sandra Pianalto - also pointed at housing on Friday as a key impediment to a stronger recovery, calling it “a significant headwind.”

Pianalto, who is a voter this year on the Fed’s policy-setting panel, said declines in housing wealth were keeping consumers away from stores and making harder for businesses to borrow. Bernanke said the loss of housing wealth may be chopping $200 billion to $375 billion off of consumer spending per year.

Several Fed officials have come forward since the white paper was released to push for action, although it has caused discomfort in some quarters of the central bank’s system.

Bernanke made the case that overly tight credit in mortgage markets had undercut the effectiveness of the Fed’s aggressive efforts to stimulate growth.

The Fed cut overnight interest rates to near zero in 2008 and has bought $2.3 trillion in bonds in a further effort to drive mortgage and other borrowing costs lower.

In a typical recovery, a rebound in housing fuels hiring and income gains, but that has not been the case this time, Bernanke said.

In the face of the congressional criticism of the white paper, Bernanke recently told lawmakers he was sorry if the central bank’s efforts were misunderstood as anything but a helpful effort to spell out policy options.

He defended the study again on Friday.

“One of our main objectives … was simply to make people aware how central to the recovery housing is,” Bernanke said in response to a question from the audience.

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The Bank of England will raise its target for asset purchases next week as the debt crisis in Europe may have already pushed Britain